Developed nations turn fire on emerging states

Emerging economies have come under fire from developed countries at the annual meetings of the International Monetary Fund for a backsliding on domestic economic reforms and slowing growth rates.

After many years in which poorer countries have lectured the US, Europe and Japan for their economic failures, the tables were turned after the summer turmoil in emerging markets. Emerging economies are now being told to stop complaining and put their own houses in order.

Finance ministers and central bankers say that emerging economies complained when advanced economies resorted to ultra-low interest rates that sent capital flooding into developing economies and complain again when the policies are being reversed.

The forcefulness of advanced economy finger-pointing has been damped, however, by embarrassment the US faces over its inability to resolve its budget and debt ceiling issues. The debacle has overshadowed the IMF annual meetings.

Opening the meetings, Christine Lagarde, IMF head, called for any easing of Federal Reserve monetary stimulus to take place in “as well communicated way as possible”.